A Model to Project Flows into and out of Tax-Deferred Retirement Savings Accounts: Technical Paper 2004-15

Working Paper
October 1, 2004

Paul Burnham

This paper provides the complete specification of a model to project contributions to, investment earnings of, and distributions from tax-deferred retirement savings accounts. The model is used to project taxable pension distributions and IRA withdrawals for the Congressional Budget Office’s (CBO’s) 10-year baseline. A 75-year version of the model was also used to produce the estimates for the CBO Paper “Tax-Deferred Retirement Savings in Long-Term Revenue Projections.” The model is presented in two parts: one covering individual retirement accounts and defined-contribution plans, and the other covering defined-benefit plans. The variables used in the model are defined in an appendix.